Legislative Trends – Workers’ Compensation 2023

The 2023 legislative session is giving states the opportunity to turn the page on covid related legislation and address areas that were previously overlooked during the thick of the pandemic. While issues such as medical cannabis and presumptions are seeing renewed interest from last year, topics including physician dispensing have emerged. Meanwhile, fee schedules continue to be reviewed and updated amongst the states.  

Physician Dispensing  

The practice of physician-dispensing in workers’ compensation can be a contentious topic. While opponents believe it to incite higher costs and potentially incur clinical safety concerns, supporters see it as convenient for patients, able to improve medication adherence, and best enabled to assist underserved areas, including rural communities. Most states allow for physician dispensing with the exception of New Jersey, New York, Massachusetts, Texas, Utah & Wyoming. In 2023 Texas and Florida introduced measures to address physician dispensing. 

• Texas legislators introduced several pieces related to physician dispensing. However, many of these proposals stalled. TX HB1240 that excludes workers’ compensation, received a favorable report from the House Public Health Committee, yet ultimately did not receive a floor vote. Similar legislation (HB595) allowing for physician dispensing in workers’ compensation, failed to make it out of the committee process.  

• Florida’s Department of Workers’ Compensation (DWC) issued rules late last year that would clarify that physician dispensed drugs cannot be denied simply because they are dispensed by a physician. DWC proposals also include a prior authorization requirement for physician dispensed medications. These regulatory initiatives are anticipated to cost approximately $8 million dollars, which requires the legislature to approve such measures. The House and the Senate approved these regulatory measures with the passage of HB487.  

Medical Cannabis 

Following the U.S. Supreme Court’s decision last year, medical cannabis reimbursement in workers’ compensation remains a matter left to the states. As it stands, 21 states, along with Washington D.C. and Guam, allow for the recreational use of cannabis. 38 states currently allow for medical cannabis. States that do not have medical cannabis programs could have a low CDB/low THC for qualified conditions (GA, IA, IN, NC, SC, TX, TN, WI, WY). Only Kansas, Idaho, and Nebraska do not offer any medical cannabis-related programs. This year states including Massachusetts, Kentucky, and Pennsylvania considered expanding medical cannabis access.   

• Massachusetts introduced legislation that would allow for medical cannabis reimbursement in workers’ compensation. The Bay state currently bars medical cannabis reimbursement for work-related injuries due to a prior court decision.  
• Kentucky became the 38th state to allow for medical cannabis. Language submitted by the legislature bars workers’ compensation reimbursement for medical cannabis. 

• Pennsylvania, like many states, decided the issue of medical cannabis reimbursement in workers’ compensation through the courts. A state court determined in March that medical cannabis reimbursement is permitted for work-related injury claims.  

Provider Choice 

A small number of states introduced measures that would permit injured workers to choose their medical providers. Allowing injured workers to choose their medical providers is shown to improve adherence and promote confidence in treatment. However, opponents of choice argue that since the employer is footing the bill for workers’ compensation insurance, they should retain the ability to determine who treats the injured worker. States such as Iowa, Montana, New York, and Tennessee took action this session to give injured workers more control over their care.  

• Iowa’s legislature considered S365 which would grant injured workers the ability to choose their doctor for workers’ compensation related injuries. Bill language prohibited insurers from obstructing an injured workers choice of physician. The proposal did not advance out of committee.  

• Montana’s proposal would bar an insurer, managed care organization or healthcare provider from requiring a worker use a particular treating physician or engage in any act of practice of intimidation, coercion, or threat or against a worker to use a particular treating physician. Although receiving a hearing the legislation (HB719) did not make it out of committee.  
• New York’s Workers’ Compensation Board (NYWCB) implemented direction of care protocols late last year. In response, legislative leaders introduced proposals that would provide injured workers with a say in their care. Legislation put forth (NY S1974) would give injured workers the ability to select their pharmacy of choice among in-state pharmacies. While passing the Senate, the legislation is expected to have difficulties in the Assembly.  
• Tennessee’s SB1263/HB1467 similar to Iowa would provide injured workers with the choice of physician while also clarifying that an injured workers choice cannot be interfered with. While receiving multiple hearings in the Senate Commerce & Labor Committee, the bills did not make it out of the committee process.  

Presumptions 

As clinical data continues to emerge, the expansion of presumption benefits is gaining momentum from legislators for first responders and other high-risk occupations. Presumptions allow injured workers with greater levels of risk to access workers’ compensation benefits without a high burden of proof. More than half of all states proposed legislation related to presumption coverage this session. Mental health (including PTSD) and cancer presumption coverage were the most common state presumptions put forth.  

Cancer 

States including California, Connecticut, Missouri, Montana, Nebraska, Vermont, Virginia, West Virginia proposed legislation to enhance or establish cancer protections primarily for firefighters while also attempting to expand eligibility to similar first responder groups.  

• Connecticut reviewed legislation that would provide firefighters battling cancer with a formal presumption.  

• Missouri statehouse members offered legislation aiming to provide comprehensive presumptive coverage for several conditions including cancer to several classes of first responders.  
• Montana enacted legislation that added certain cancers to the state’s cancer presumption eligibility list.  
• Nebraska lawmakers introduced legislation that would provide presumptive coverage for firefighters where a carcinogen is reasonably associated with a specific cancer.  
• Vermont would add reproductive and thyroid cancers to the state’s presumption eligibility list.  
• Virginia enacted legislation that would allow arson and hazardous material investigators to become eligible for presumptive cancer coverage.  

• West Virginia attempted to add certain cancers to the state’s cancer presumption eligibility list.  
   

Mental Health/PTSD  

California, Idaho, Kansas, Missouri, Nebraska, South Carolina, Tennessee, and Virginia were some of the states that proposed measures to address mental health for high-risk occupations. Mental health presumptions can be complex as some states still require that a physical injury occur before a mental injury develops to be considered a workers’ compensation related injury.  

• California’s legislature considered legislation that would allow medical technicians, certain state nurses, psychiatric technicians, social services specialists, and paramedics to fully qualify for the state’s PTSD presumption.  
• Idaho statehouse leaders enacted legislation that extends the state’s PTSD presumption for first responders.  
• Kentucky statehouse leaders mulled proposals that would permit various classes of first responders to qualify for PTSD presumptive coverage.  
• Missouri legislators sought to establish presumptive coverage for first responders diagnosed with PTSD.  
• Tennessee lawmakers finalized proposals that would extend PTSD benefits to firefighters.  

• South Carolina legislative leaders hope to find agreement on language that would provide first responders with mental injuries coverage without needing a physical injury to occur.  
• Virginia statehouse members put forth bill language attempting to enhance occupational eligibility for the state’s PTSD presumption.  

Fee Schedules 

Whether changing procedural codes or reimbursement rates, fee schedule updates in workers’ compensation were explored by Colorado, Georgia, Illinois, New Mexico, Oregon, South Carolina, and Vermont in 2023. States reviewing fee schedules later in the year will likely do so in July or October. 

• Colorado regulators introduced restrictions on physician dispensing. Thes limitations would require certain controlled substances including opioids and benzodiazepines to be filled through a pharmacy.  
• Georgia updated its pharmaceutical dispensing fee for pharmacies.  
• Illinois lawmakers considered a proposal that would establish payment protocols for compound medications.  
• New Mexico’s Workers’ Compensation Administration (WCA) updated its fee schedule by clarifying language concerning pre-authorization and utilization reviews. WCA officials also added provisions formally permitting telehealth services to be reimbursable in workers’ compensation.  
• Oregon’s Workers’ Compensation Division updated procedural codes and removed the agency’s pharmaceutical justification form requirement for certain claim medications prescribed after April 1.  

• South Carolina’s Workers’ Compensation Commission (WCC) updated conversion factors and codes.  
• Vermont legislators introduced bill language that would require the Vermont Department of Labor to review the state’s fee schedule on at least a biennial basis.  

2023 and Onwards 

Legislative sessions concluded in Arkansas, Arizona, Colorado, Florida, Georgia, Hawaii, Iowa, Indiana, Idaho, Kentucky, Louisiana, Maine, Maryland, Mississippi, Montana, New Mexico, North Dakota, South Dakota, Tennessee, Utah, Virginia, Washington, West Virginia & Wyoming. As legislatures wrap up in other states, lawmakers will attempt to finalize budgets and reconcile bill language for legislative pieces near the finish line. For workers’ compensation, presumptive coverage bills are expected to continue being a topic of discussion to prevent potential coverage gaps and despite remaining a federally classified schedule I substance, medical cannabis’s momentum in the past years seems to persist as injured workers explore all their treatment options. While the issue of provider choice is not as prominent, it could become a renewed topic of discussion as delays and denials among first responders in multiple states become a troubling phenomenon.